THE 


Railroads  and  the  Public 


ADDRESSES 


The  Contemporary  Club 


George  G.  Crocker,  Esq. 
Joseph  D.  Potts,  Esq. 
Joseph  S.  Harris,  Esq. 
George  B.  Roberts,  Esq. 


12  January ,  1892 


PHILADELPHIA 


privately  printed  for  the  contemporary  club 
1892 


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THE 


Railroads  and  the  Public 

ADDRESSES 

DELIVERED  BEFORE  »  .  ,  ;v 

The  Contemporary  Club 


BY 

George  G.  Crocker,  Esq. 
Joseph  D.  Potts,  Esq. 
Joseph  S.  Harris,  Esq. 
George  B.  Roberts,  Esq. 


12  January ,  1892 


PHILADELPHIA: 


privately  printed  for  the  contemporary  club 
1892 


Digitized  by  the  Internet  Archive 
in  2017  with  funding  from 

University  of  Illinois  Urbana-Champaign  Alternates 


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565.  t 
C  16r 


Mr.  C.  Stuart  Patterson,  the  President  of  the  Club : 

Any  phase  of  the  railway  question  is  an  appropriate 
subject  of  discussion  before  this  Club,  for  there  is  nothing 
more  contemporary  than  the  railway.  Men  now  living 
witnessed  its  birth.  We  all  have  seen  its  development 
from  independent  transporting  corporations  into  the  great 
railway  systems,  which  carry  passengers  without  trans¬ 
shipment,  and  freight  without  breaking  bulk,  from  Maine 
to  Texas,  and  from  the  Atlantic  to  the  Pacific. 

The  railways  are  so  much  a  part  of  our  daily  life  that 
it  is  difficult  to  realize  that  there  ever  was  a  time  when  the 
movement  of  passengers  was  limited  by  the  endurance  of 
horses,  and  when  the  cost  of  transportation  interposed  so 
effectual  a  barrier  to  the  movement  of  freight  that  the  limit 
of  the  profitable  carriage  of  a  cord  of  wood  was  twenty 
miles,  and  of  a  barrel  of  flour  one  hundred  and  fifty  miles. 

The  growth  of  the  railway  system  and  the  development 
of  the  prosperity  of  the  country  have  been  to  each  other 
reciprocally  cause  and  effect.  The  railways  have  invited 
immigration  by  their  development  of  that  great  northwest 
in  which  the  immigrants  have  found  their  homes.  They 
have  made  the  toil  of  the  farmer  productive  by  bringing 
the  markets  of  the  world  to  his  door.  They  have  rendered 
available  the  mineral  wealth  of  the  country  by  moving  the 
ore  to  the  mint  and  the  furnace.  They  have  stimulated 
manufactures  by  the  rapid  transportation  of  the  raw  ma¬ 
terial  to  the  factory,  and  the  manufactured  product  from  it. 
They  have  built  up  great  cities  in  carrying  the  trade  by 
which  those  cities  live,  and  the  prosperity  of  the  cities  has 
been  reflected  in  the  prosperity  of  tracts  of  tributary  terri¬ 
tory.  They  have  made  foreign  commerce  profitable,  by 
creating  markets  for  imports,  and  by  providing  return  car¬ 
goes  in  agricultural,  mining  and  manufacturing  exports. 

(3) 


4 


More  than  this,  they  have  overcome  the  disintegrating  in¬ 
fluences  of  distance  and  of  conflicting  sectional  interests. 
They  have  secured  the  permanence  of  the  Union.  With¬ 
out  the  railways  the  original  thirteen  States,  separately 
developed,  would  never  have  remained  united.  The  rail¬ 
ways  have,  therefore,  bound  together  the  union  of  the 
States  with  bands  of  steel. 

At  the  end  of  the  year  1890  this  country  had  more 
than  one  hundred  and  sixty  thousand  miles  of  completed 
railway,  whose  construction  was  capitalized  in  stock  and 
bonds  at  about  ten  billions  of  dollars.  In  that  year  more 
than  five  hundred  millions  of  passengers  travelled  upon  the 
railroads  of  this  country,  and  more  than  six  hundred  million 
tons  of  freight  were  moved,  each  ton  being  carried  on  an 
average  one  hundred  and  twenty  miles.  The  railway  busi¬ 
ness  of  a  continent  cannot  be  conducted  without  some  fric¬ 
tion.  Rival  railway  lines  have  conflicting  interests,  and 
their  respective  managers  cannot  always  agree.  Passen¬ 
gers  and  owners  of  freight  clamor  for  low  rates  and  oppose 
unjust  discrimination,  either  local  or  personal.  Bondhold¬ 
ers  and  shareholders  naturally  desire  their  stipulated  inter¬ 
est  and  the  maximum  of  dividends.  You  can  run  a  railway 
train  by  machinery,  but  you  cannot  manage  a  railway  by 
machinery.  For  that  you  must  employ  human  instrumen¬ 
talities,  who  are  necessarily  fallible,  and  who  have  indi¬ 
vidualities  which  cannot  be  altogether  repressed. 

From  this  it  follows  that  individual  rights  are  some¬ 
times  trampled  upon.  What  ought  to  be  done  ?  What  can 
be  done? 

It  is  not  for  me  to  answer  to-night,  in  the  presence  of 
our  guests,  the  questions  which  I  have  put. 

One  answer  that  has  been  given  to  these  questions  is 
the  appointment  by  the  government  of  the  United  States, 
and  by  the  governments  of  some  of  the  States,  of  railroad 
commissions,  with  greater  or  less  power  of  supervision  and 
control  over  the  railways.  Of  all  these  commissions,  the 


one  which  has  been  most  successful  is  the  Massachusetts 
commission.  It  has  succeeded  because  the  powers  of  the 
commission  have  been  limited.  They  have  been  authorized 
to  advise  and  not  to  adjudge.  They  have  depended,  as  Mr. 
Adams  has  said,  upon  “  the  eventual  supremacy  of  an  en¬ 
lightened  public  opinion.”  Another  element  of  their  suc¬ 
cess  is  in  the  fact  that  the  commissioners  have  been  so  able 
and  so  impartial  that  their  recommendations  have  had  the 
force  of  judgments. 

I  have  the  pleasure  of  introducing  to  the  Club,  Mr. 
Crocker,  the  Chairman  of  the  Massachusetts  Board  of 
Railroad  Commissioners. 


Mr.  Crocker: 

The  railroad  is  about  sixty  years  of  age.  For  years 
after  its  birth  it  had  a  struggle  for  existence  with  its  great 
competitors,  the  canal  and  the  turnpike.  It  was  a  weak 
thing,  constantly  appealing  to  the  public  for  favors,  and 
holding  out  the  promise  that  the  debt  would  be  abundantly 
repaid  by  the  commercial  prosperity  and  growth  which  it 
would  induce.  This  promise  has  been  fulfilled.  In  their 
wildest  flights  of  hope  and  fancy,  the  original  builders  of 
the  railroad  never  dreamed  even  of  what  was  to  be  its 
future  greatness  and  power.  The  growth  of  the  railroad 
system  has  been  unequalled  in  the  history  of  the  world  by 
that  of  any  other  industrial  enterprise.  It  is  to-day  ac¬ 
knowledged  as  the  instrumentality  which  has  made  possi¬ 
ble  the  magnificent  progress  of  our  country  in  wealth  and 
population — a  development  which  is  the  wonder  and  the  ad¬ 
miration  of  the  world.  Upon  the  railroad  absolutely  depends 
the  continuance  of  that  prosperity  and  growth.  Nay, 
more,  the  railroad  is  the  life-blood  of  the  nation.  If  the 
operation  of  our  railroads  should  cease,  the  result  would  be 
not  simply  widespread  stagnation,  but  widespread  starva¬ 
tion. 

It  is  generally  true,  with  reference  to  industrial  enter¬ 
prises,  that  their  prosperity  depends  upon  the  public ;  but 
it  is  not  true  of  any  other  industrial  enterprise  as  it  is  of 
the  railroad,  that  upon  it  the  public  is  absolutely  dependent, 
not  simply  for  prosperity,  not  simply  for  comfort,  but  for 
the  means  of  existence  and  for  the  preservation  of  life 
itself. 

In  considering  therefore,  the  relations  of  the  railroads 
to  the  public,  the  first  thing  to  be  borne  in  mind  is  that 
each  is  necessary  to  the  existence  of  the  other— that  there 
is  a  vital  mutuality  between  them.  Not  only  are  the  rela- 

(6) 


7 


tions  between  them  of  vital  importance,  but  these  relations 
are  complicated  to  a  degree  seldom  realized ;  and  it  is  my 
purpose  to-night,  in  my  brief  talk  with  you,  simply  to 
direct  your  attention  to  a  few  of  these  complications  and 
to  impress  upon  you  that  the  railroad  problem,  so  called, 
is  no  simple  question  which  can  be  dealt  with  by  the  ignorant 
without  disaster,  but  that  it  is  one  of  the  most  difficult  and 
important  problems  now  before  the  people  of  these  United 
States,  and  that  those  who  know  the  most  about  it  are  the 
ones  who  will  express  themselves  most  conservatively  in 
regard  to  the  best  means  of  correcting  great  evils  which 
undeniably  exist. 

Marvellous  is  the  story  of  engineering  skill  and  inven¬ 
tive  genius  displayed  in  the  construction  of  our  roadbeds 
and  the  rolling-stock  equipment.  Each  detail  of  the  road¬ 
way,  whether  it  be  of  the  ballast,  the  tie,  the  spike,  the  joint, 
the  rail,  the  switch,  the  signal,  each  detail  of  the  compli¬ 
cated  structure  of  the  locomotive,  each  detail  of  the  more 
simple  construction  of  the  car,  not  only  of  those  parts  of 
the  car  which  are  essential  to  safety,  namely,  the  axle,  the 
box,  the  wheel,  the  brake-shoe,  the  brake  apparatus  and  the 
coupling,  but  also  of  those  parts  which  promote  the  com¬ 
fort  of  the  passengers,  such  as  racks,  windows,  seats  and 
heating  apparatus,  has  an  eventful  and  interesting  history. 

Some  men  know  about  some  of  these  details.  Few 
men  are  masters  of  them  all,  and  yet  it  is  far  more  easy  to 
find  men  who  understand  the  problems  of  construction 
and  of  mechanical  operation  than  it  is  to  find  men  who 
understand  other  problems  connected  with  railroading,  to 
which  I  desire  to  direct  your  attention. 

The  roads  first  built  were  short  roads  and  generally 
within  the  limits  of  a  single  State.  They  were  isolated. 
There  were  no  other  railroads  connecting  with  them.  The 
problem  of  their  operation  was  a  simple  one.  They  were  * 
of  local  importance  only.  This  condition  of  affairs  con¬ 
tinued  down  to  about  1850,  when,  by  the  building  of  exten- 


8 


sions  and  the  construction  of  connecting  lines,  the  inter¬ 
state  business  began  to  assume  important  proportions. 
This  was  only  forty  years  ago.  History  since  that  date 
has  been  history  contemporary  with  many  of  those  here 
present.  It  was  not  until  1870,  or  a  little  over  twenty 
years  ago,  that  the  railroad  traffic  became  interoceanic 
traffic.  Since  that  date  history  has  been  contemporary 
with  all  of  those  present. 

During  the  wonderful  growth  of  our  railroad  system, 
amounting  now  in  the  United  States  to  160,000  miles,  the 
process  of  merger,  consolidation  and  reoganization  of  com¬ 
panies  has  been  constantly  going  on.  It  is  now  unusual 
to  find  a  railroad  which  is  wholly  within  the  limits  of  a 
single  State.  The  Atchison  system  with  its  seven  thou¬ 
sand  miles  of  roadway  runs  in  thirteen  States  and  terri¬ 
tories. 

In  coming  here  from  Boston  by  what  is  known  as  the 
Shore  Line,  I  have  been  in  six  different  States. 

There  are  47  States  and  territories,  and  each  one  of 
them  has  a  legislature  of  its  own  consisting  of  two  branches. 

The  average  number  of  legislators  in  each  State  is  one 
hundred,  so  that  there  are  47  State  or  territorial  legislatures 
composed  of  4,700  legislators  passing  laws  relating  to  rail¬ 
roads.  Of  these  legislators  some  are  wise  and  some  ignor¬ 
ant,  some  honest  and  some  corrupt,  some  strong  and  some 
weak,  some  unprejudiced  and  some  prejudiced,  some  public- 
spirited  and  some  selfish,  some  independent  and  some  seek¬ 
ing  for  votes,  some  conservative  and  some  destructive. 
Each  State  or  territory  has  its  own  laws  relating  to  rail¬ 
roads,  and  to  those  laws  each  railroad  corporation  is  sub¬ 
ject,  so  far  as  its  roadbed  and  the  operation  of  its  road  in 
that  State  are  concerned.  We  have  here  the  elements  not 
only  of  confusion  but  also  of  conflict.  It  might  well  have 
been  thought  that  through  traffic  could  not  be  carried  suc¬ 
cessfully  under  such  conditions.  There  has,  however,  been 
no  serious  trouble.  The  difficulties  which  have,  in  fact, 


9 


arisen  have  been  few,  and  there  has  been  little  or  no  con¬ 
flict  of  authority. 

In  the  laws  relating  to  the  execution  of  wills  and  other 
documents,  in  relation  to  insolvency  and  in  relation  to  mar¬ 
riage  and  divorce,  there  is  great  lack  of  harmony,  but  with  ref¬ 
erence  to  railroads,  where  there  was  an  opportunity  for  con¬ 
flict  a  thousand  times  greater,  though  there  has  been  diver¬ 
sity,  there  has  been  but  little  incongruity.  This  is  due 
partly  to  the  genius  of  the  American  people,  but  more  espe¬ 
cially  to  the  fact  that  the  railroad  companies  have  themselves 
seen  to  it  that  they  are  not  crippled  by  inharmonious  and 
unwise  legislation.  They  have  had  able  and  learned  counsel 
to  protect  their  interests,  and  through  their  care  and  jealous 
oversight  injurious  conflict  has  been  happily  avoided. 

Not  only  are  our  railroads  subject  to  the  legislation  of 
each  State  through  which  they  run,  but  they  are  also  sub¬ 
ject  to  the  authority  of  the  United  States  under  its  consti¬ 
tutional  power  to  regulate  commerce  between  the  States. 
State  authority  is  limited  by  State  boundaries,  but  the  con¬ 
stitutional  power  of  the  United  States  extends  to  the  regu¬ 
lation  of  the  transportation  of  every  passenger  and  pound 
of  freight  going  from  one  State  to  another,  and  to  all  the 
means  and  methods  by  which  such  transportation  is 
effected.  This  power  extends  not  only  to  those  railroads 
which  run  from  one  State  into  another,  but  also  to  those 
railroads  which  are  wholly  within  the  limits  of  a  single 
State,  in  so  far  as  they  are  engaged  in  the  transportation 
of  passengers  or  freight  coming  from  or  going  into  another 
State. 

The  Supreme  Court  of  the  United  States,  in  speaking 
with  reference  to  the  power  of  Congress  to  regulate  com¬ 
merce,  has  said,  “  It  is  the  power  to  prescribe  the  rules  by 
which  commerce  shall  be  governed  :  that  is,  the  conditions 
upon  which  it  shall  be  conducted.  It  embraces  within  its 
control  all  the  instrumentalities  by  which  that  commerce 
may  be  carried  on  and  the  means  by  which  it  may  be  aided 


10 


and  encouraged.”  The  declaration  of  the  scope  of  this 
constitutional  right  to  regulate  commerce  has  within  the 
last  decade  been  greatly  broadened.  It  would  seem  that  it 
is  within  the  power  of  Congress  not  only  to  regulate 
fares  for  passengers  and  freight,  but  also  to  determine  how 
the  cars  for  the  transportation  of  passengers  and  freight 
shall  be  built,  what  their  dimensions  shall  be,  what  their 
appliances  for  convenience  and  safety  shall  be,  what  shall 
be  their  rate  of  speed,  what  stops  they  shall  make,  what 
shall  be  the  method  of  construction  and  the  weight  of 
locomotives,  what  shall  be  the  method  of  construction  and 
the  supervision  of  roadway,  of  tracks  and  of  bridges,  what 
system  of  road  signals  shall  be  used,  what  shall  be  the 
character  of  the  station  accommodations  and  how  the 
public  shall  be  protected  at  such  stations,  what  regulations 
shall  be  enforced  in  regard  to  the  operation  of  the  road, 
and  what  regulations  shall  be  prescribed  as  to  the  compen¬ 
sation  of  employees  and  the  limitations  of  their  hours  of 
labor. 

In  considering  the  relations  between  the  States  and 
the  United  States,  it  must  be  borne  in  mind  that  State 
traffic  and  interstate  traffic  are  not  now  separate,  nor  can 
they  be  considered  separable.  State  traffic  and  interstate 
traffic  are  carried  on  the  same  railroads,  in  the  same  trains, 
and  in  the  same  cars. 

Thus  far  the  regulation  of  the  operation  of  our  railroads 
by  Congress  has  been  small  as  compared  with  the  extent 
of  its  powers.  The  chief  purpose  of  the  Interstate  Com¬ 
merce  Act  was  to  prevent  unjust  discrimination  between 
individuals  and  communities,  and  that  act  does  little  more 
than  to  lay  down  certain  general  principles  governing  rates 
and  the  interchange  of  traffic,  and  to  require  publicity  of 
rates  and  due  notice  of  any  increase  of  the  same. 

Thus  far  there  has  been  no  conflict  between  regulation 
by  the  United  States  and  regulation  by  the  States,  but 
conflict  is  possible.  Aldace  F.  Walker,  late  a  member  of 


II 


the  Interstate  Commerce  Commission,  in  a  recent  paper 
relating  to  railway  associations,  writes  that  the  State  and 
the  United  States  authority  over  railroads  cannot,  in  his 
opinion,  coexist  for  many  ycais. 

Railroad  managers  have,  however,  to  meet  other  diffi¬ 
culties  than  those  growing  out  of  the  fact  that  railroads  are 
subject  to  the  legislation  of  many  States,  and  to  the  control¬ 
ling  and  all-pervading  legislation  of  Congress.  These  are 
the  difficulties  growing  out  of  their  own  corporate  limits. 
There  are  now  over  1,700  separate  railroad  corporations  in 
the  United  States,  and  the  number  of  operating  roads  is 
about  400.  Corporate  lines  of  division  are  made  without 
reference  to  State  lines.  The  termini  of  railroad  systems 
are  not  State  lines,  but  cities.  In  travelling  between 
Philadelphia  and  Boston,  a  passenger  is  carried  over  the 
iron  of  five  distinct  corporations. 

Generally  speaking,  the  passenger  experiences  no  in¬ 
convenience  when  he  passes  from  the  road  of  one  corpora¬ 
tion  to  the  road  of  another.  The  line  between  corporations 
is  as  easily  passed  as  the  line  between  States.  As  a  rule, 
a  passenger  is  subjected  to  no  more  frequent  changes  of 
cars  than  he  would  be  if  all  roads  were  controlled  by  one 
corporation  and  subject  to  a  single  jurisdiction.  The  same 
is  true  of  freight.  It  can  generally  be  billed  through  to  its 
point  of  destination  upon  a  single  payment.  Uniformity  in 
the  classification  of  freight  has  not  yet  been  attained,  but 
individual  classifications  have  from  time  to  time  been 
merged  and  consolidated,  so  that  there  are  now  four  great 
classifications  covering  the  whole  country. 

To  thus  carry  passengers  or  freight,  on  the  iron  of  sev¬ 
eral  corporations  without  change  of  cars  and  on  a  single  ticket 
or  way  bill,  requires  joint  tariffs,  joint  earning  contracts, 
interchange  of  cars,  car  mileage  and  repair  agreements,  and 
a  credit  system  in  which  each  railroad  is  recognized  as  the 
financial  agent  of  others  directly  or  indirectly  connected 
with  it.  The  division  of  the  money  received  for  fare  and 


12 


freight  between  the  various  roads  over  which  passengers 
or  freight  are  carried,  and  the  settlement  of  the  accounts 
growing  out  of  the  use  and  repair  of  cars  render  necessary 
a  most  elaborate  and  expensive  accounting  system. 

The  struggles  for  advantage  between  corporations 
forming  parts  of  through  lines  present  most  perplexing 
difficulties,  but  they  are  simple  and  mild  indeed  as  compared 
with  those  struggles  which  are  the  outgrowth  of  compe¬ 
tition  between  parallel  lines.  Competition  has  worked 
wonders  in  this  country.  It  has  developed  our  railroad 
system  with  fabulous  rapidity.  In  promoting  safety,  com¬ 
fort  and  speed  it  has  been  a  most  effective  agency,  an  agency 
far  more  efficient  than  government  supervision  or  regulation 
can  be.  In  railroading,  competition  has  wrought  the  work 
of  improvement  more  wonderfully  than  in  any  other  indus¬ 
try.  Competition  has  compelled  economical  management, 
and  has  caused  continual  reductions  of  rates  until  they  have 
reached  a  point  at  which  they  are  seldom  complained  of  as 
too  high,  but  only  because  they  lack  uniformity  and  stability. 
Great,  however,  as  is  the  debt  which  we  owe  to  competition, 
its  work  has  not  been  free  from  injurious  elements.  The 
advantages,  open  or  secret,  which,  largely  as  a  result  of  com¬ 
petition,  had  been  given  to  individuals  and  to  sections,  and 
by  which  the  strong  were  made  stronger  and  more  wealthy, 
and  the  weak  weaker  and  impoverished,  were  the  immediate 
cause  leading  to  the  Granger  movement  in  the  West  and  the 
passage  of  the  Interstate  Commerce  Act.  Unbridled  com¬ 
petition  has  been  the  parent  of  discrimination,  and  it  is  the 
foe  of  publicity.  Competition  loves  darkness  rather  than 
light. 

The  making  of  joint  and  competitive  tariffs  and  the 
division  of  rates  among  railroads  is  largely  the  work  of  the 
various  so-called  railroad  associations.  It  has  been  found 
much  easier  to  make  these  agreements  than  to  secure  adher¬ 
ence  to  them  after  they  have  been  made. 

Judge  Thomas  M.  Cooley,  at  the  National  Convention 


13 


of  Railroad  Commissioners,  held  at  the  rooms  of  the  Inter¬ 
state  Commerce  Commission  in  Washington,  in  March  of 
the  present  year,  in  opening  the  convention,  discussed  the 
question  as  to  what  should  properly  be  understood  by  the 
term  “railroad  problem,”  and  he  reached  the  conclusion 
that  the  greatest  railroad  problem  was  as  to  the  best  method 
of  making  and  changing  the  rates  for  passenger  and  freight 
transportation.  Let  me  quote  a  few  words  from  his  ad¬ 
dress  :  “  So  long,”  he  said,  “  as  five  hundred  bodies  of  men 
in  the  country  are  at  liberty  to  make  rate-sheets  at  pleasure, 
and  to  unmake  or  cut  and  re-cut  them  in  every  direction 
at  their  own  unlimited  discretion,  or  want  of  discretion, 
and  with  little  restraint  on  the  part  of  the  law,  except  as 
it  imposes  a  few  days'  delay  in  putting  changes  in  force, 
the  problem  will  remain  to  trouble  us.  The  existence  of 
the  power  makes  such  disorder  and  confusion  constantly 
imminent.” 

The  difficulties  resulting  from  the  multiplicity  of  our 
corporations  have  been  greatly  diminished  of  late.  The 
transportation  of  through  traffic  has  been  simplified  by  con¬ 
solidation  of  connecting  lines,  and  the  serious  evils  which 
have  developed  as  a  result  of  competition  have  been  in  some 
measure  checked  by  the  consolidation  of  competing  lines. 
As  has  been  stated,  the  roads  of  1,700  distinct  corporations 
are  now  operated  by  about  400  operating  companies.  In 
fact,  69  corporations  operate  64  per  cent,  of  the  railroad 
mileage  of  the  United  States. 

This  consolidation  of  interests  has  progressed  with 
remarkable  rapidity  of  late  years,  and  has  met  with  little 
opposition  from  the  public,  but  it  is  not  an  unquestionable 
good.  Corporations  may  become  of  such  size  and  power 
as  to  be  a  menace  to  the  rights  of  the  people. 

In  so  far  as  competition  is  done  away  with,  we  avoid 
the  evils  which  have  resulted  from  it,  but  we  lose  also  its 
benefits.  As  competition,  on  the  whole,  does  much  more 
good  than  harm,  the  result  is  a  net  loss  to  the  public. 


14 


Such  are  some  of  the  perplexities  which  grow  out  of 
the  operation  of  our  railroads  by  a  large  number  of  sepa¬ 
rate  corporate  existences,  each  one  of  which  is  subject  to 
the  will  of  the  legislatures  of  the  States  through  which 
the  road  runs,  and  each  subject  also  to  the  overruling 
power  of  Congress.  Certainly,  the  difficulties  have  been 
surmounted  in  a  remarkable  manner.  The  results  are 
much  better  than  could  have  been  expected. 

It  is  wonderful  that  railroad  traffic  under  such  circum¬ 
stances  can  be  conducted  with  so  little  inconvenience  to 
the  public  and  with  so  little  indication  of  the  obstacles 
which  have  been  encountered.  The  disturbing  elements, 
however,  still  exist,  and  nothing  but  wise  and  progressive 
treatment  will  prevent  them  from  making  serious  trouble 
in  the  future. 

There  is  a  panacea  for  all  these  troubles,  and  that  is 
to  have  the  railroads  operated  by  the  strong  arm  and  the 
single  power  of  the  United  States.  It  is  urged  that  then 
the  utmost  simplicity  would  be  reached. 

There  would  be  one  management  instead  of  400  man¬ 
agements. 

The  struggles  between  those  400  managements  for 
advantage  would  be  eliminated. 

There  would  be  no  more  stock-jobbing  management. 

There  would  be  no  more  watering  of  securities. 

The  evils  of  competition  would  be  done  away  with. 

One  part  of  the  country  would  be  served  as  well  as 
another  part  of  the  country. 

Passengers  and  freight  could  be  carried  by  the  shortest 
route  at  the  lowest  rate. 

The  paying  lines  would  support  the  unprofitable  lines, 
and  the  railroad  system  would  be  practically,  therefore, 
one  immense  pool. 

In  rates,  as  in  everything  else,  there  would  be  uni¬ 
formity  and  simplicity.  There  would  be  stability  and 
publicity.  There  would  be  no  competition  to  lead  to  dis- 


15 


crimination,  and  everybody  and  every  section  would  be 
treated  fairly  and  equally. 

Such  is  the  argument  of  the  Nationalists.  Not  long 
ago  it  was  stated  in  the  papers  that  of  forty-one  Congress¬ 
men  who  had  responded  to  a  circular  letter  addressed 
them  by  some  farmers’  alliance,  eleven  had  declared  them¬ 
selves  in  favor  of  having  the  United  States  own  and 
operate  our  railroads.  Although  it  is  probable  that  an 
amendment  of  the  Constitution  would  be  required  in  order 
to  carry  out  such  a  proposition,  still  its  merits  should  be 
discussed. 

Assuming  for  the  moment  that  the  management  of 
the  railroads  by  the  United  States  would  be  better  than 
their  present  management,  it  by  no  means  follows  that  the 
work  of  operating  the  railroads  should  be  undertaken  by 
the  United  States.  Of  the  magnitude  of  the  problem  and 
of  the  results  which  would  be  likely  to  follow  government 
ownership  and  operation  we  can  gain  some  idea  from  a  com¬ 
parison  of  our  railroads  with  the  Post-office  Department. 

In  executive  ability  the  present  Postmaster-General 
has  few  equals  in  the  United  States.  In  his  report  for  the 
fiscal  year  ending  June  30,  1889,  he  writes  as  follows  : 

“To  the  Postmaster-General  of  the  United  States  is 
committed  the  management  of  the  largest  business  concern 
in  the  world,  consisting  of  a  central  establishment  with 
almost  60,000  branches  and  employing  over  1 50,000  people. 
It  agents  embrace  one-half  of  the  civil  list.  It  maintains 
communication  between  the  near  and  the  remote  places  of 
the  country  with  frequency,  celerity  and  security.  .  .  . 

The  capital  in  use  in  carrying  on  this  vast  business  was 
last  year  $1  to  each  man,  woman  and  child  in  the  United 
States.  ...  In  twenty  years  the  transactions  of  the 
Post-office  Department  have  doubled.  In  ten  years  more, 
by  all  the  laws  of  growth,  they  will  nearly  have  doubled 
again.  To-day’s  work,  the  routine  forms,  the  methods  of 
operation,  the  relations  of  clerks  and  officials,  are  almost 


i6 


as  crude  as  they  were  in  the  beginning.  .  .  .  The 

Postmaster-General,  in  taking  up  the  duties  of  the  Post- 
office  Department,  generally  finds,  with  his  own  advent, 
that  other  new  officers  also  enter  the  service.  The  whole 
organization  from  the  top  is  changed  and  the  work  falls 
into  untrained  hands.  During  a  period  of  ten  years  there 
were  eight  different  Postmasters-General.  In  our  form  of 
government  this  constant  change  will  continue,  but  from  a 
business  standpoint  thus  to  unsettle  the  service  and  to  be 
always  educating  new  sets  of  men  cannot  be  beneficial  to 
any  department.  However  able  any  new  Postmaster- 
General  and  his  associates  in  the  Assistant  Postmaster- 
Generalships  may  be,  there  must  be  a  course  of  training, 
which  time  and  experience  alone  can  give,  before  any  of 
them  are  able  to  handle  with  real  effectiveness  the  divi¬ 
sions  placed  in  their  charge.  Even  with  each  of  them 
well  skilled  and  at  his  best,  it  is  not  possible  to  keep  up 
with  the  work.” 

He  further  states  that  the  business  growing  out  of 
the  necessary  appointments  and  removals  in  the  army  of 
employees,  the  complaints  of  irregular  or  poor  service,  the 
demands  for  enlarged  service,  for  the  building  of  new  post- 
offices,  improvements  in  postal  facilities  and  in  the  number 
of  deliveries  for  the  large  post-offices,  and  for  the  procuring 
of  supplies,  the  details  of  mail  operation,  the  time  schedules, 
the  determination  of  routes  and  rates,  the  making  of  con¬ 
tracts,  the  collection  of  dues  and  the  delivery  of  stamps 
and  envelopes,  make  up  a  complicated  mass  of  business 
which  is  unequalled  by  any  other  similar  department  in 
the  world. 

“  Think  for  a  moment,”  he  writes,  “  of  a  city  of  60,000 
population  and  the  daily  changes  by  death,  defalcations, 
lapses  and  necessary  removals,  and  an  idea  will  be  sug¬ 
gested  of  the  labor  attending  this  oversight.  No  man  can 
do  the  work  as  it  is  now  organized  except  in  a  superficial 
way.  No  great  business  establishment  can  succeed  that 


changes  its  principal  officers  once  in  fifteen  months.  The 
Post-office  Department  cannot  do  it  any  more  than  the 
Pennsylvania  or  the  New  York  Central  Railroad.” 

He  plainly  states  that  the  equipment  of  post-offices 
varies  according  to  the  zeal  of  the  postmaster ;  that  the 
postmasters  who  are  aided  by  members  of  Congress  and 
who  are  most  persistent  get  the  most ;  and  that  extensions, 
development  and  improvement  depend  almost  altogether 
upon  some  kind  of  pressure  from  outside. 

He  declares  that  the  touch  of  the  Department  upon 
post-offices  throughout  the  country  is  very  slight ;  that  the 
machinery  is  set  up  and  then  let  alone,  if  only  certain 
formal  reports  are  made  at  stated  times  ;  and  that  the 
offices  and  the  Department  are  generally  in  an  unfriendly 
attitude  because  each  postmaster  has  wants  which  the 
Department  is  not  ready  or  able  to  grant. 

The  Postmaster  winds  up  his  report  as  follows  :  “  The 
Postmasters-General  have  been  men  of  great  ability,  but 
the  country  grows  so  fast  that  the  Post-office  Department 
unconsciously  has  lost  step  and  fallen  behind  in  the  steady 
march  of  quickening  enterprise.” 

Now  let  us  turn  from  the  post-office  to  our  railroads. 
There  are  60,000  post-offices  in  the  United  States.  There 
are  about  the  same  number  of  railroad  stations.  The  rail¬ 
road  system  has  also  160,000  miles  of  track  and  over  eleven 
hundred  thousand  cars. 

Our  railroads  carry  500,000,000  passengers  per  year 
and  over  600,000,000  tons  of  freight,  each  passenger  being 
carried  on  the  average  twenty-four  miles  and  each  ton  of 
freight  120  miles. 

The  railroads  further  carry  the  mails  for  the  Post-office 
Department.  One-half  of  the  whole  expenditure  of  the 
Post-office  is  paid  for  the  transportation  of  mails,  and  most 
of  this  work  is  done  by  the  railroads. 

The  Postmaster-General  reports  that  the  capital  used 
in  carrying  on  the  post-offices  amounts  to  one  dollar  for 


i8 


every  inhabitant  of  the  United  States.  The  capitalization 
— that  is,  the  capital  stock  and  net  debt  of  our  railroads — is 
$10,000,000,000,  or  $160  per  inhabitant,  160  times  as  much 
as  the  capital  used  in  carrying  on  the  Post-office. 

The  total  annual  receipts  of  the  Post-office  Depart¬ 
ment,  according  to  the  report  referred  to,  were  $46,000,000. 
The  total  annual  receipts  of  the  railroads  are  $1,000,000,000, 
or  more  than  twenty  times  as  much. 

The  total  number  of  employees  of  the  Post-office  is 
1 50,000.  The  total  number  of  employees  of  our  railroads 
is  750,000;  and  if  we  had  in  this  country  as  many  employees 
on  our  railroads  per  mile  of  track  as  they  have  in  Germany, 
instead  of  having  750,000  employees  we  should  have  over 
2,000,000  employees,  or  fourteen  times  as  many  as  are  em¬ 
ployed  in  the  Post-office.  This  number  of  750,000  employ¬ 
ees  does  not  include  the  vast  number  of  people  who  are 
employed  in  providing  supplies  and  material,  in  construct¬ 
ing  railroads  and  building  cars. 

Can  our  form  of  government  stand  such  a  strain  ? 
Can  we  afford  to  subject  it  to  the  test?  To  the  dangers 
of  immense  patronage  will  be  added  the  vastly  more  potent 
influence  which  unscrupulous  politicians  may  exercise  for 
party  purposes,  by  discriminations  in  accommodations 
or  rates  between  different  States  or  between  different 
communities  in  the  same  State.  The  experience  of  Anglo- 
Saxon  Australia  in  the  governmental  operation  of  its  rail¬ 
roads  is  not  encouraging.  Let  us  not  fly  from  the  ills  we 
have  to  those  we  know  not  of.  The  people  have  many 
causes  for  complaint  in  those  countries  where  the  roads 
are  operated  by  the  government  as  well  as  in  our  own 
country. 

Wonders  have  already  been  accomplished,  and  the 
difficulties  which  are  now  pending  and  impending  through 
corporate  management  are  not  so  great  as  those  which 
have  been  already  overcome.  In  modern  English  railway 
history,  although  there  is  fierce  competition,  harmful  dis- 


ig 


criminations  are  unknown.  The  railways  of  England  and 
the  United  States,  for  the  speed  of  trains,  the  accommoda¬ 
tions  furnished,  and  for  their  energy  of  management,  stand 
at  the  head  of  the  list  of  the  railways  of  the  world.  Fur¬ 
ther  than  this,  it  may  be  said  that  in  England  the  American 
railway  is  held  up  with  commendation  as  a  bright  example 
of  cheapness  of  service,  flexibility  of  management  and 
technical  progress.  We  must  not,  however,  shut  our  eyes 
to  the  fact  that  serious  evils  exist  and  serious  dangers 
threaten. 

Danger  lurks  in  complexity,  instability,  discrimination, 
and  secrecy.  Safety  depends  on  simplicity,  stability  and 
publicity. 

Mr.  Patterson  :  It  has  been  pleasant  to  hear  the 
voice  of  Massachusetts  upon  this  question ;  it  will  be 
equally  pleasant  to  hear  the  voice  of  Philadelphia.  We 
have  with  us  to-night  one  who  has  had  a  long  and  varied 
experience  as  a  railway  official,  and  as  the  head  of  a  great 
transporting  organization  which  was  itself  a  freighter  upon 
the  railways.  I  now  present  to  the  Club  an  honored 
citizen  of  Philadelphia,  Mr.  Potts. 


Mr.  Potts  : 

Mr.  President ,  and  Ladies  and  Gentlemen  : 

The  question  of  Transportation,  certain  phases  of 
which  you  have  just  heard  discussed,  is  one  of  the  weight¬ 
iest  of  living  topics.  It  has  grown  more  rapidly  than  it 
has  been  comprehended  ;  and  the  commercial  health  of  the 
nation  requires  that  this  condition  be  changed;  that  its 
essential  principles  be  broadly  understood,  and  the  proper 
regulation  of  its  great  power  be  intelligently,  justly,  and 
completely  established. 

I  hope  you  will  not  consider  it  unfitting  if  I  refer,  by 
way  of  a  short  prelude,  to  what  may  be  deemed  the  Gen¬ 
esis  of  Transportation;  to  the  imperative  character  of  the 
instincts  it  has  been  created  to  gratify — instincts  which 
have  grown,  and  which  will  continue  to  grow  in  volume 
and  force,  as  means  for  their  gratification  increase  in  ex¬ 
tent,  in  excellence,  and  in  cheapness. 

The  impulse  to  movement,  to  motion,  to  change 
of  locality,  seems  inherent  in  all  matter.  The  great 
spheres  which  occupy  space  are  forever  moving  ;  the  infin¬ 
itesimal  atoms  of  which  matter  consists  are  never  quiet, 
excepting  under  restraint.  Animal  life  has  its  recurring 
periods  of  restlessness,  and  the  human  animal,  man,  is 
dominated  by  the  same  irresistible  law.  Only  the  re¬ 
straints  of  inconvenience,  lack  of  physical  power,  and  lack 
of  time,  keep  mankind  within  reasonable  bounds  of 
quietude.  The  possession  of  money  in  modern  times 
somewhat  lessens  the  force  of  these  restraints,  and  the  pal¬ 
pable  results  of  such  possession  have  led  an  acute  observer 
to  say  that  “  when  a  rich  American  has  built  himself  a 
house  in  the  city,  another  in  the  country,  and  a  cottage  by 
the  sea  or  in  the  mountains, — then — he  travels.”  The 
motives  to  movements  are  multitudinous  ;  to  movements 

(20) 


21 


of  persons,  of  property,  of  ideas  ;  motives  of  pleasure,  of 
sorrow,  and  of  gain  ;  the  supply  and  reception  of  news,  and 
the  demand  and  supply  for  and  of  materials  for  use  and  grat¬ 
ification.  These  motives  are  endless  in  quantity  and  vari¬ 
ety,  but  they  are  all  in  constant  activity ;  and  they  all  im¬ 
pel  and  compel  movement. 

The  palliation  and  the  partial  removal  of  the  forms  of 
restraint  just  named,  which  so  hamper  these  ever-present 
impulses  to  movement,  has  become  in  modern  days  one  of 
the  greatest  of  human  industries.  It  is  the  Science  and 
the  Art  of  Transportation. 

Let  us  glance  briefly  at  some  of  the  achievements  of 
this  immense  industry.  Instead  of  the  rugged  and  broken 
natural  surface  of  the  earth,  to  be  wearily  and  slowly 
plodded  over  on  foot,  in  danger,  with  exhausting  toil,  with 
great  loss  of  useful  time,  and  with  the  most  barbaric  dis¬ 
comfort,  we  have  the  smooth  railway  and  the  vestibule 
train,  and  we  eat  and  sleep  in  luxury,  comfort,  and  safety, 
while  gliding  easily  along  at  fifty  miles  an  hour.  The 
great  water  surfaces  of  the  globe,  upon  which  in  his  early 
history  man  could  not  safely  venture,  are  now  traversed 
in  huge  vessels,  safely,  comfortably,  and  swiftly,  and  with 
such  certain  punctuality  that  spaces  of  thousands  of  miles 
are  covered  with  variations  of  but  a  few  hours  in  the  times 
of  the  voyages  ;  and,  indeed,  under  favoring  conditions  of 
sea  and  weather,  these  differences  are  measured  by 
minutes. 

Our  ideas  are  passed  from  point  to  point  with  still 
greater  perfection  of  method.  The  telegraph,  the  tele¬ 
phone,  and  the  extraordinary  postal  systems  of  civilized 
countries,  especially  that  of  the  United  States,  make  the 
interchange  of  ideas  rapid  and  cheap  to  a  degree  which  but 
a  short  time  since  would  have  appeared  impossible,  unless 
it  had  been  wrought  miraculously. 

If  we  turn  from  what  has  been  done  in  the  way  of  re¬ 
moving  restraints  on  the  movement  of  man  and  his  belong- 


22 


ings  to  the  effect  which  such  partial  removals  have 
worked,  we  will  find  the  most  abundant  confirmation  of 
the  declaration  already  made,  that  the  tendency  to  move¬ 
ment  is  constant  and  all-pervading,  and  that  nothing  but 
natural  hindrances  prevent  its  increasing  conversion  from 
tendency  to  deed. 

Bear  in  mind  that  Transporters  have  not  wholly  re¬ 
moved  difficulties  ;  they  have  only  modified  some  of  them, 
and  this,  in  part,  by  converting  them  into  a  new  form  of 
difficulty,  the  new  form  being  a  charge  of  money.  In¬ 
stead  of  spending  time  and  strength  in  tramping  from 
place  to  place,  the  traveller  buys  a  ticket,  for  which  he  dis¬ 
burses  money  ;  instead  of  carrying  his  goods  on  his  back 
through  the  wilderness,  he  pays  a  freight  rate,  and  for  the 
sending  of  his  letters  three  thousand  miles,  he  uses  a 
stamp  which  costs  him  two  cents. 

He  can  earn  the  requisite  cash  for  the  ticket,  for  the 
freight  rate,  and  for  the  stamp,  with  much  less  outlay  of 
time  and  of  labor  than  was  required,  when,  by  his  own 
efforts,  his  person  or  his  property  was  moved  ;  so  that, 
while  his  movement  is  still  under  restraint,  still  subject  to 
whatever  difficulties  may  be  represented  by  the  rates  of 
charge  and  the  conditions  made  by  Transporters,  his  re¬ 
straint  has  been  greatly  lessened,  and  the  extent  of  move¬ 
ment  has,  therefore,  been  greatly  enlarged. 

I  don’t  wish  to  worry  you  with  statistics,  but  I  will 
venture  to  give  you  a  few  figures,  because  in  no  other  way 
can  you  be  so  briefly  shown  how  increases  in  movement 
have  followed  the  physical  improvements  and  the  lessened 
cost  already  established  by  Transporters. 

Take  an  example  from  the  movement  of  property  : — 
On  the  railroads  of  the  United  States  the  aver¬ 
age  c’harge  for  moving  one  ton  of  property 
one  mile  was — 

In  1880 .  lyVo  cents 

In  1890 .  TVo  cents 


23 


The  tons  moved  one  mile  per  each  person  of 
the  entire  population  of  the  United  States 
were — 

In  1880 .  645 

In  1890 . ! .  1,265 

That  is,  the  reduction  in  rates  was  a  little  more  than  one- 
fourth  per  ton,  while  the  increase  in  movement,  per  per¬ 
son,  was  nearly  doubled. 

Take  an  example  from  the  movement  of  letters  : 

The  rate  of  letter  postage  charged  by  the 


United  States  was — 

In  1880,  for  half  an  ounce  or  less .  3  cents 

In  1890,  for  an  ounce  or  less .  2  cents 


The  movement  of  letters  through  the  mails  dur¬ 
ing  the  same  years,  for  each  person  of  the 


entire  population,  was — 

In  1880,  approximately .  21 

In  1890,  approximately .  30 


Disregarding  the  effect  of  the  change  in  maximum 
weight,  as  an  effect,  the  extent  of  which  cannot  now  be 
ascertained,  we  find  the  result  to  be  a  deduction  in  charges 
of  one-third  per  letter,  and  an  increase  in  movement  of 
nearly  one-half  per  person.  4 

All  hindrances  to  movement,  however,  are  not  yet 
represented  by  a  charge.  Some  loss  of  time  is  yet  involved, 
and  in  the  cases  of  long  journeys,  very  much  time 
which  often  can  be  illy  spared.  Our  practical  speed,  how¬ 
ever  is  yet  slow — not  over  fifty  miles  an  hour — and  better¬ 
ments  in  this  respect  can  be  reasonably  hoped  for.  It  is 
much  slower  than  certain  varieties  of  birds  are  said  to  have 
attained,  and  what  birds  have  done,  man  can  probably  do. 
Some  bodily  wear  and  tear  is  yet  a  necessity,  and  this  may 
never  be  wholly  removed,  but  it  is  certainly  lessened 
yearly. 

The  chief  hindrances  of  to-day  are  represented  in  part 
by  the  tariff  conditions  of  Transporters,  and  by  their  rates 


24 


of  charge,  especially  by  the  irregularities  and  discrimina¬ 
tions  of  such  rates,  and  by  their  sudden  and  severe  fluctua¬ 
tions.  They  are  also  represented,  in  part,  by  suddenly 
developed  incompetencies  of  Transporters  to  meet  sud¬ 
den  growths  of  movement ;  or  to  meet,  promptly,  clearly 
foreseen  increases  in  demands  for  track,  power,  and  car¬ 
riage  facilities.  And  they  are,  finally,  also  represented,  to 
a  large  extent,  by  the  evil  results  of  many  unwisely  con¬ 
ducted  struggles  for  traffic,  and  for  monopoly  of  position, 
which  are  waged  between  railway  corporations,  and  which, 
by  a  curiously  weak  misnomer,  are  classified  under  the 
title  of  Competition. 

It  is  to  a  consideration  of  some  of  these  existing  obsta¬ 
cles,  which  bar  our  way  to  more  effective  transportation 
conditions,  that  I  will  now  ask  your  attention. 

Perhaps  our  perception  of  the  evils  we  suffer  from, 
and  of  the  possible  remedies  for  them,  may  be  quickened 
and  clarified  by  first  making  plain  to  our  minds,  what  con¬ 
ditions  of  transportation  capacities  we  would  like  to  have 
— what  conditions,  which,  in  the  light  of  present  knowl¬ 
edge,  will  probably  be  improvements  on  those  we  now  pos¬ 
sess,  and  yet  not  be  beyond  a  reasonable  hope  of  practical 
attainment.  To  set  forth  these  new  and  desirable  condi¬ 
tions  with  any  approach  to  adequate  fulness,  I  have  found 
to  be  quite  impossible  within  the  limits  of  time  permitted 
by  a  proper  regard  for  your  patience.  I  can  therefore  but 
hint  at  a  few  of  their  outlines  ;  and,  indeed,  I  have  been 
obliged  to  restrict  these  hints  to  the  subject  of  property 
movement  only,  and  that  by  railway  within  the  United 
States. 

First,  then,  we  must  have  reasonable  rates  of  charge, 
and  reasonable  stability  in  such  rates,  so  that  the  great 
interchanges  of  traffic  will  not  have  possible  ruin  always 
impending  over  their  owners,  through  sudden  and  violent 
changes  in  tariffs.  To-day  all  traffic  is  so  exposed,  and 
many  severe  and  costly  demonstrations  of  this  truth  have 


25 


made  the  boldest  commercial  minds,  timid  and  halting  in 
their  movements,  excepting  when  they  can  procure,  in  ad¬ 
vance,  and  from  competent  authority,  assurances  against 
such  risks.  Communities  which  possess  two  or  more  really 
competitive  routes,  equally  effective  and  far-reaching,  are 
less  exposed  to  this  danger  than  others.  It  is  indeed  a 
frequent  practice  for  a  Transporter  to  maintain  high 
charges  to  or  from  points  which  no  other  Transporter  can 
reach,  while  making  low  rates  to  and  from  other  points 
which  are  in  competition  with  rivals.  There  are  few  prac¬ 
tices  more  tempting  to  the  Transporter,  but  none  more  ill- 
judged,  nor  more  permanently  harmful  to  both  Transporter 
and  locality.  It  is  an  abominable  evil,  which  should  be 
absolutely  suppressed. 

Stability  must  be  attained,  however,  by  means  that 
will  not  stifle  improvement.  Destructive  competition  has, 
as  its  one  good  effect,  the  betterment  and  cheapening  of 
methods  ;  but  surely  our  civilization  is  not  at  this  day  so 
crude  that  progress  in  method  cannot  be  won  in  better 
ways  than  by  the  destructiveness  of  the  savage. 

Next :  we  must  have  a  greater  approximation  to  uni¬ 
formity  in  rates  of  charge,  and  absolute  freedom  from  in¬ 
equitable  discrimination  between  shippers.  The  big  ship¬ 
pers  must  not  be  charged  so  much  less  than  the  little  ship¬ 
pers,  that  the  little  ones  shall  perish  and  the  big  ones  find 
their  business  increasingly  swollen.  It  is  proper  and 
necessary  to  have  a  wholesale  rate  and  a  retail  rate  of 
charge  ;  but  the  basis  of  the  wholesale  rate  must,  both  for 
the  public  benefit  and  the  interest  of  the  Transporters,  be 
small  enough  to  be  attained  by  the  many,  and  not  so  large 
that  it  can  only  be  reached  by  the  few. 

Again  :  we  must  have  a  separation  of  terminal  and 
transfer  charges  from  the  road  charges.  Terminals  and 
transfer  facilities  are  costly,  and  their  expenses  cannot  be 
easily  cheapened.  The  great  future  economies  will  be 
made  in  the  movement  between  terminals,  and  it  is  this 


26 


movement  which  the  individual  members  of  the  public  can¬ 
not  provide  cheaply,  each  for  himself.  It  is  here  that  the 
main  usefulness  of  the  great  Transporter  is  found.  Many 
shippers  prefer  to  provide  their  own  terminals  and  do  their 
own  terminal  work.  When  they  can  do  so  they  should  have 
the  right  to  do  so,  and  they  should  not  be  charged  for  what 
they  do  themselves. 

Again :  we  must  have  a  separation  of  road  charges 
into  charges  of  a  certain  amount  when  cars  are  furnished 
by  the  road-owner,  and  charges  of  a  less  amount  when  cars 
are  furnished  by  others.  Many  prefer  to  furnish  their  own 
cars,  and  should  be  allowed  to  do  so,  and  such  division  of 
the  total  road  charges  should  be  made  as  will  fairly  appor¬ 
tion  them  according  to  the  relative  capital  and  risk  of  each 
interest.  This  should  apply,  whether  the  car-owner  carries 
traffic  for  himself  or  for  others.  Under  this  regulation, 
shortage  in  car  supplies  will  become  less  frequent,  and  the 
railway  will  approximate  the  character  of  a  Common  High¬ 
way  ;  a  result  much  to  be  desired. 

Again :  we  must  have,  within  defined  limits,  a  practi¬ 
cal  blending,  for  the  movement  of  cars  and  property,  of  all 
the  railroads  of  the  country,  as  they  are  now,  and  as  they 
may  be  hereafter,  into  a  single  effective  system.  That  is, 
the  rates  of  road  charges  should  be  on  a  mileage  basis,  and 
should  apply  to  the  total  mileage  any  shipment  may  make, 
regardless  of  the  fact  that  it  may,  in  its  transit,  pass  over 
many  roads  differently  owned.  This  will  be  easily  accom¬ 
plished  if  the  divisions  of  the  road  charges  already  sug¬ 
gested  be  made,  and  if  every  road  be  compelled  to  move, 
with  impartial  promptness,  over  its  tracks  (but  not  into  its 
terminals)  every  suitable  car  which  may  be  offered  to  it. 

Proper  rules  as  to  such  interchange  of  cars,  including 
also  just  requirements  as  to  the  character  of  the  cars, 
should,  of  course,  be  established. 

Again  :  railroad-owners,  as  one  of  their  duties,  should 
be  under  compulsion  to  be  suitably  supplied  with  tracks 


2  7 


and  power.  This  is  a  question  of  difficulty,  and  ought  not 
to  be  adjusted  inequitably;  but  it  should  not  be  left,  as  it 
now  is,  wholly  to  the  degree  of  providence  or  foresight, 
financial  skill  or  commercial  courage,  possessed  by  each 
such  road-owner. 

These  leading  changes  impress  me  as  absolutely  essen¬ 
tial  to  be  made,  and  made  as  speedily  as  may  be  consist¬ 
ent  with  equity,  legal  power,  practicability  and  good  judg¬ 
ment.  They  will  constitute,  I  believe,  a  set  of  fairly  effec¬ 
tive  remedies  for  the  main  imperfections  yet  developed  in 
our  present  system  of  Inland  Traffic  Movement.  There 
are,  of  course,  other  difficulties  needing  cure,  including 
difficulties  local  to  cities  and  to  all  closely-settled  com¬ 
munities,  which  I  cannot  touch  on  now. 

If  what  I  have  said  be  correct,  we  have  then  to  con¬ 
sider  the  equities  involved  in  these  changes  ;  afterward 
the  legal  power  to  make  them ;  and,  finally,  the  practical 
method,  if  any  can  be  found,  of  accomplishing  them. 

And  first,  what  equities  are  to  be  considered?  I  take 
it  no  American,  in  his  moments  of  sober  thought,  will  feel 
that  any  readjustments  of  conditions  can  stand,  or  ought 
to  stand,  or  will  produce  permanently  useful  results,  unless 
they  be  founded  on  equity. 

When,  early  in  this  century,  the  movement  began 
among  civilized  nations,  looking  to  inland  transportation 
upon  a  scale  beyond  all  precedent,  each  large  community 
turned  naturally  to  its  governments,  Municipal,  Provincial, 
State  or  National,  as  the  only  available  organizations  com¬ 
petent  to  provide  for  a  common  need  ;  the  cost  and  appar¬ 
ent  risk  of  which  were  so  much  beyond  the  range  of  in¬ 
dividual  power.  Moreover,  the  idea  of  a  Common  High¬ 
way  was  properly  a  dominant  one.  Hence  States  built 
canals  and  railways,  and,  later,  lesser  communities  joined 
interests  with  individuals  in  constructing  like  works.  The 
National  Government  of  the  United  States  built  a  great 
macadamized  road.  European  governments  embarked 


28 


largely  in  the  improved  form  of  highways.  Certain  disad¬ 
vantages  in  many  cases  were  soon  developed  under  govern¬ 
mental  ownership  and  operation.  Political  necessities  often 
took  precedence  of  commercial  necessities,  and  the  gov¬ 
ernmental  management  became  frequently  incompetent 
and  tainted. 

Most  communities  in  this  country  grew  satisfied  that 
the  element  of  individual  interest  must  be  introduced  to 
secure  transportation  efficiency,  and  avoid  governmental 
deterioration.  The  introduction  of  such  an  interest  soon 
became,  with  a  few  exceptions,  the  general  rule  here,  and 
forms  of  corporate  organization  were  evolved,  in  which, 
under  restrictions  for  the  public  protection,  thought  at  the 
time  to  be  sufficient,  but  which  have  often  since  proved 
inadequate,  the  private  interest  of  the  Transporter  became 
the  leading  motive,  and  the  convenience  and  interest  of 
the  public  subordinate  considerations,  excepting  when 
and  as  it  became  clear  to  the  Transporter  that  deference 
to  the  latter  motives  would  contribute  to  his  own  prosperity. 

Vast  amounts  of  individual  money  have  been  invested 
in  this  form  of  public  service,  under  the  belief  that  this 
relation  of  interests  would  always  continue. 

It  would  be  unfair  to  sacrifice  to  any  improper  degree 
these  individual  interests,  thus  authoritatively  called  into 
existence ;  but  the  time  seems  to  have  arrived  when, 
through  the  processes  here  suggested,  or  such  other  pro¬ 
cesses  as  may  seem  to  be  wiser,  but  in  any  case  by  processes 
which  shall  be  mutually  just,  the  public  service  must  take 
the  front  place  as  a  motive,  and  the  private  interest  of  the 
Transporter  an  equitable,  but  a  secondary,  position. 

The  next  point,  that  of  legal  power,  is  one  which  I 
think  need  hardly  be  considered  at  present.  Under  our 
form  of  government,  whatever  a  sufficient  number  of  the 
people  ultimately,  and  after  full  consideration,  decide  shall 
become  the  law,  will  be  made  the  law,  and  the  present 
moment  is  the  time  for  discussion  and  for  experimenting. 


2.9 


and  not  for  much  law-making.  We  therefore  come,  finally, 
to  the  consideration  of  methods  of  reformation. 

Railroad-owners  are  clearly  unable  to  introduce  such 
methods  unaided.  They  have  tried  to  harmonize  in  various 
ways  ever  since  the  dawn  of  competition  among  them,  and 
their  efforts  have  been  but  a  continuous  succession  of  short¬ 
lived  pacifications,  alternated  with  longer  periods  of  mutual 
reproaches,  impartially  distributed  breaches  of  faith,  and 
bitter  and  destructive  rate  wars,  track  wars,  and  wars  over 
every  other  species  of  difference  between  them.  The  pub¬ 
lic  look  with  disfavor  upon  peace  conferences  between  rail¬ 
road  companies,  and  in  fact  have  now  made  Pooling  unlaw¬ 
ful.  The  Pool  was,  perhaps,  the  most  nearly  successful 
form  of  traffic  combination,  on  a  great  scale,  ever  made  in 
this  country ;  but  it  was  only  imperfectly  maintained;  and 
when  its  provisions  seriously  pinched  the  prosperity  of  any 
member,  the  Pool  was  only  preserved  because  those  mem¬ 
bers  whose  interests  it  was  aiding,  winked  at  the  secret 
remedial  methods  resorted  to  by  the  member  whose  inter¬ 
ests  it  was  harming. 

The  public  disfavor  would  not  have  been  unwise  had 
the  Pool  been  perfect.  Such  a  huge  combination  of  almost 
unchecked  power  over  the  fortunes  of  citizens  would  have 
certainly  been  unwholesome,  and  might  easily  have  grown 
dangerous.  But  the  natural  existing  conditions  make  Pool¬ 
ing  substantially  harmless  at  present,  and  its  illegality  is, 
therefore,  at  this  time  a  needless  safeguard. 

The  separate  States  are  clearly  incompetent  to  estab¬ 
lish  efficient  regulations.  Their  jurisdiction  is  limited  to 
their  own  boundaries,  while  the  controlling  traffic  is  Con¬ 
tinental. 

There  is  but  one  power  which  can  deal  with  the  subject 
effectively,  and  that  is  the  Government  of  the  United 
States.  This  power  has  made  a  movement  in  this  direction 
by  enacting,  and,  to  some  extent,  enforcing,  the  Interstate 
Commerce  Law.  The  movement  has  been  useful,  but  less 


30 


so  than  was  hoped  for.  It  has  cured  something,  and  has 
probably  tended  to  prevent  more  harm  than  it  has  discov¬ 
ered  or  punished.  The  commission  created  under  it  has 
labored  under  a  radical  disadvantage  in  not  having  among 
its  members  either  trained  transporters  or  capable  mer¬ 
chants  or  manufacturers,  and  of  being  loaded  with  duties 
which  entirely  overtax  a  single  tribunal.  If  it  was  confined 
to  the  duty  of  interpretation,  and  if  the  duty  of  enforcement 
was  divided  among  a  number  of  other  tribunals,  the  results 
should  be  better.  The  power  it  claims,  of  determining 
absolutely  the  rates  of  charge,  is  a  dangerous  power,  which 
Transporters  are  naturally  contesting,  and  which,  if  it  exists, 
should  doubtless  be  modified. 

The  precise  relation  which  the  National  Government 
should  adopt  toward  this  question  is  very  uncertain  in  the 
public  mind.  Government  ownership  and  operation  are 
urged,  but  I  think  this  view  is  not  held  by  those  who  have 
carefully  studied  the  subject.  Such  a  course  is  open  at 
present  to  many  objections,  some  of  which  seem  vital. 

Probably  the  wisest  relation  it  can  now  establish  is 
that  of  a  Controlling  Regulator.  Tariffs  of  charge  and  tariff 
conditions  cannot  be  made  with  good  judgment,  excepting 
by  trained  experts,  and  such  experts  are  to  be  found  almost 
wholly  engaged  in  performing  the  active  duties  of  Trans¬ 
porters  ;  therefore  such  tariffs  should  be  primarily  framed 
by  the  Transporters  themselves. 

Railroad-owners  can  be  forced  by  suitable  National 
Legislation  to  wholly  forego  participation  in  foreign  or 
interstate  business,  unless  they  unite  in  certain  prescribed 
relations. 

These  relations  should  comprise  proper  regulations  and 
agreements  for  the  proper  conduct  of  all  their  business,  and 
proper  tariff  conditions  and  rates  of  charge ;  all  upon  the 
bases  finally  determined  upon.  Such  agreements,  after 
formulation,  should  be  subject  to  the  judgment  of  a  National 
Tribunal  composed  of  capable  lawyers,  transporters,  and 


3i 


shippers.  In  cases  of  irreconcilable  differences  between 
that  Tribunal  and  the  Transporters,  such  differences  should 
be  controllingly  passed  on  by  the  Supreme  Court  of  the 
Nation.  Variations  in  form  or  essence  from  such  rates  and 
regulations  while  in  force,  should  be  punishable  by  heavy 
penalties,  both  corporate  and  individual ;  and  the  detection 
of  such  offences  and  their  punishment  should  be  done  at 
the  National  cost,  and  before  any  one  of  a  sufficient  number 
of  National  courts  to  insure  convenience  and  prompt  results. 
A  few  important  convictions  and  punishments  would  prob¬ 
ably  make  the  subsequent  legal  business  of  this  sort  quite 
limited  in  quantity.  Changes  in  either  rates  or  rules  thus 
established  should  be  made  only  by  the  same  authorities, 
and  through  the  same  formal  processes  as  the  originals. 

These  suggestions,  and  perhaps  all  suggestions  having 
similar  purposes,  will  hardly  commend  themselves  to  the 
existing  railway-owner.  No  curtailment  of  privilege  or 
power  ever  seemed  wise  at  first,  to  him  who  suffered  such 
loss.  But  it  should  not  be  forgotten  that  this  power  is,  in 
the  aggregate,  greater  over  the  fortunes  of  the  people  than 
any  ever  before  possessed,  even  by  governments  in  times 
of  peace,  if  the  governments  were  free.  The  people  of 
several  of  our  States  have  already  grown  so  restless  under 
the  existence  of  this  power  and  some  of  its  evil  results,  that 
laws  bearing  a  painful  leaning  toward  confiscation  have  been 
enacted.  Such  laws,  of  course,  hurt  both  sides,  as  all  in¬ 
equitable  action  always  does ;  but  they  have  been  made,  and 
will  probably  have  worse  successors,  unless  enlightened  and 
competent  remedies,  consistent  with  peace,  be  established. 

But  I  must  close.  The  subject  is  illimitable,  and  does 
not  easily  adjust  itself  to  condensation. 

Permit  me  to  thank  you  heartily  for  your  patient 
attention  to  a  topic  which  is  so  much  more  technical  than 
dramatic. 


Mr.  Patterson  : 

We  have  listened  to  the  discussion  of  the  relation  of 
railways  to  the  public  as  presented  from  the  point  of  view  of 
the  railroad  commissioner,  and  as  presented  from  the  point 
of  view  of  the  customer  of  the  railway.  It  is  now  our  good 
fortune  to  have  the  same  subject  presented  from  the  point 
of  view  of  the  railway  official.  I  now  present  to  the  Club, 
Mr.  Harris,  President  of  the  Lehigh  Coal  and  Navigation 
Company. 

Mr.  Harris: 

Ladies  and  Gentlemen :  It  may  not  seem  wise  for  me 
to  take  much  of  the  short  time  allotted  to  me  this  evening 
to  discuss  how  the  transportation  interests  of  the  country 
have  drifted  into  their  somewhat  antagonistic  relation  to 
the  other  business  of  the  community,  so  that  they  rather 
than  other  occupations  should  be  thought  to  require  govern¬ 
mental  control. 

It  is,  however,  wise  before  attempting  to  change  an 
existing  order,  especially  one  whose  growth  has  been 
natural  and  gradual,  to  consider  how  such  conditions 
came  to  be. 

It  is  not  much  beyond  the  memory  of  living  persons 
when  this  people  first  recognized  that  if  the  broad  domain 
of  the  United  States  were  ever  to  become  one  country, 
better  means  of  intercommunication  must  be  established 
than  those  furnished  by  nature  in  river  navigation. 

Improved  roads  are  older  than  the  century,  but  the 
canal  system  grew  up  in  its  first  50  years,  and  the  railroads 
have  been  built  within  the  recollection  of  middle-aged  men. 

When  it  became  fairly  understood  that  our  greatest 
industrial  problem  was  so  to  cheapen  and  hasten  transpor¬ 
tation  and  intercourse  over  the  millions  of  square  miles  of 

(32) 


33 


our  domain  that  there  should  be  no  danger  of  a  divorce  of 
interest  or  affection  between  remote  districts  of  diverse 
production,  this  people  set  themselves  to  work  with  all  the 
men  that  were  available  or  that  could  be  imported,  and 
all  the  money  that  they  could  spare  or  could  borrow, 
to  solve  the  problem  in  the  shortest  possible  time ;  and 
for  fifty  years  there  has  been  no  business  career  more 
attractive  than  that  of  the  railroad  constructor  or  railroad 
manager,  and  no  pursuit  which  has  been  more  profitable. 

In  this  railway  development  we  have  expended  over 
nine  thousand  millions  of  dollars,  and  for  most  of  the  time 
during  which  the  work  has  been  progressing,  all  new  com¬ 
munities  at  least  have  considered  railroads  an  absolute 
good,  have  welcomed  their  advent,  and  have  done  every¬ 
thing  in  their  power  to  promote  their  construction. 

But  the  attitude  of  the  public  has  changed  of  late  ; 
sanguine  youth  is  succeeded  by  critical  middle  age,  and 
the  universal  question  is,  What  net  good  has  this  great  ex¬ 
penditure  brought  us  ;  and  How  shall  we  distribute  the 
wealth  developed,  so  that  the  railroads  shall  not  secure 
large  returns  at  the  expense  of  agriculture,  manufactures, 
mining,  and  trade  ? 

All  the  just  and  unjust  criticism  of  railroad  manage¬ 
ment,  all  the  wise  and  unwise  legislation  upon  the  subject 
is  based  on  these  questions  ;  and  their  solution  must  be 
found  before  their  discussion  can  be  abandoned. 

The  American  people  is  not  intentionally  unjust,  but 
it  has  awakened  to  the  fact  that  before  it  had  the  education 
of  experience  it  did  grant  powers  to  railroad  companies 
which  it  now  sees  were  given  too  lavishly,  and  which  have 
been  often  used  selfishly  and  unmercifully. 

It  now  asks,  How  shall  these  corporations  be  taught 
that  they  are  the  servants  and  not  the  masters  of  the 
people ;  or  to  come  to  particulars,  How  shall  the  arch 
offender,  the  traffic  manager,  who  for  twenty  years  has 
been  able  to  make  or  mar  the  fortunes  of  men  and  cities, 


3 


34 


be  taught  that  he  dare  not  use  his  powers  to  build  up  that 
in  which  he  has  a  personal  or  corporate  interest,  or  to 
destroy  that  which  he  does  not  favor  ? 

Governmental  control  is  the  only  force  that  has  seemed 
adequate  to  cause  this  evil  to  cease,  and  the  attempt  to 
exercise  this  control  has  led,  in  the  hasty  impulsive  West  to 
some  legislation,  unjust  and  oppressive  to  railroads,  and 
therefore  injurious  to  all  business  interests;  in  the  more 
conservative  East  to  careful  experiments  whose  results 
have  on  the  whole  been  good ;  and  more  lately  to  national 
action,  which  has  been  beneficent,  and  which  has  in  the 
main  been  welcome  to  the  railroads  themselves. 

For  the  great  machinery  which  they  have  set  in  motion, 
whose  only  recognized  regulator  was  unlimited  competition, 
and  whose  unrecognized  governor  was  a  system  of  conces¬ 
sions  to  the  favored  few,  was  fast  proving  an  ungovernable 
monster,  and  seemed  only  too  likely  to  destroy  its  creators. 

And  further,  the  railroads  are  thoroughly  conscious 
that  there  resides  in  the  people  a  power  which  is  their 
master  whenever  it  chooses  to  assert  itself ;  and  they  are, 
therefore,  not  averse  to  a  wise  and  reasonable  control,  which, 
while  not  fettering  enterprise,  shall  rigidly  and  positively 
forbid ,  and  effectually  prevent  all  discrimination  of  service 
or  charges. 

Now  that  the  public  recognizes  that  unwise  meddling 
is  sure  to  injure  other  interests  than  the  railroads,  and  the 
railroads  feel  that  concessions  are  necessary  to  avert  radical 
interference,  the  time  seems  auspicious  to  consider  what 
can  be  done  to  conserve  all  interests,  doing  the  most  good 
with  the  least  harm. 

To  answer  this  question  satisfactorily  requires  the  de¬ 
velopment  in  practice  of  an  idea  which  is  only  beginning 
to  be  influential  in  American  life,  that  the  large  business 
interests  of  any  community  can  only  be  well  cared  for  by 
the  business  men  themselves,  and  that  they  must  be  organ¬ 
ized  for  this  purpose. 

No  legislature  composed  of  men  from  the  professions, 


35 


including  the  profession  of  politics,  artisans,  merchants, 
and  farmers,  can  possibly  understand  the  needs  of  the  iron 
industry,  or  the  potteries  of  a  particular  section,  so  well  as 
the  associated  ironmasters  or  the  potters  themselves  ;  nor 
can  any  commission ,  however  able  or  impartial,  administer 
wisely  laws  for  the  regulation  of  commerce  without  being 
in  closest  touch  with  those  who  originate  that  commerce. 

Hitherto  in  this  new  and  rich  country,  where  there 
was  so  much  room  for  everyone’s  enterprises,  each  one 
thought  it  sufficient  to  attend  to  his  own  business,  but 
spheres  of  activity  begin  now  to  impinge  on  one  another, 
and  room  for  all  can  only  be  obtained  by  careful  study  of 
the  welfare  of  the  whole. 

The  practical  measures  necessary  then  would  seem  to 
be,  organization  of  trades  to  care  for  trade  interests,  and  of 
boards  of  trade  to  guard  and  foster  the  welfare  of  commu¬ 
nities  ;  and  conferences  of  these  bodies  with  legislative 
commissions,  who  should  be  appointed  to  study  subjects  for 
industrial  legislation,  and  with  the  government  officers  ap¬ 
pointed  to  administer  the  laws  so  made. 

Schools  to  instruct  the  young  in  practical  business  life 
should  be  fostered,  but  they  can  only  give  general  training 
in  principles ;  the  practice  must  be  worked  out  by  busy 
men,  who  must  make  ever  new  applications  of  these  prin¬ 
ciples  to  the  ever-varying  problems  that  constantly  press 
for  immediate  solution. 

And  if  we  are  to  succeed  in  adjusting  these  now  jarring 
interests,  each  side  must  come  to  the  study  of  the  ques¬ 
tions  involved  with  the  belief  that  at  bottom  the  intentions 
and  desires  of  the  other  are  good,  and  that  its  errors  were 
largely  caused  by  imperfect  vision. 

Such  study,  approached  in  such  a  temper,  cannot  fail 
to  find  a  satisfactory  solution  of  the  difficult  problem  of  how 
to  adjust  the  transportation  interests  and  the  other  interests 
of  the  community ;  nor  to  convince  the  world  that  a  free  peo¬ 
ple  can  be  trusted  to  settle  its  own  industrial  differences  as 
well  as  it  has  settled  and  will  settle  its  political  questions. 


Mr.  Patterson  : 

We  have  another  guest  to-night,  whose  right  to  speak 
with  authority  upon  any  question  relating  to  railways  can¬ 
not  be  gainsaid  by  any  one.  I  now  present  to  the  Club, 
Mr.  Roberts,  the  President  of  the  Pennsylvania  Railroad 
Company. 

Mr.  Roberts: 

Mr.  President ,  and  Ladies  and  Gentlemen :  I  did  not 
come  here  to-night  with  the  expectation  of  addressing 
you  at  length  upon  a  subject  which  has  been  an  every¬ 
day  one  with  me  all  my  life,  especially  as  I  knew  it  would 
be  pretty  well  exhausted  by  my  friend  from  Massachusetts 
and  the  two  boys  who  have  just  preceded  me ;  I  call  them 
boys,  though  it  is  now  well  on  to  half  a  century,  or  a  little 
this  side  of  forty  years,  since  they  were  with  me  laying 
out  some  of  the  first  railroads  of  this  Commonwealth,  roads 
with  which  they  have  grown  up,  and  over  which  nearly  all 
of  you,  I  hope,  have  travelled  in  safety  and  comfort. 

I  understood  the  subject  to  be  discussed  here  was  the 
“  Relations  of  the  Public  to  the  Railroads  of  the  Country.” 

The  railroads  of  the  country  are  nothing  but  the 
original  highways  of  the  country  improved  ;  some  of  those 
here  to-night  think  that  they  are  not  quite  as  well  im¬ 
proved  as  they  ought  to  be  ;  and  one  of  the  gentlemen  who 
preceded  me  speaks  of  fifty  (50)  miles  an  hour  as  slow 
speed.  While  I  do  not  claim  to  be  a  fast  runner,  I  have 
been  able  to  overtake  and  jump  on  and  off  the  trains 
which  travelled  over  the  road  owned  by  the  Commonwealth 
of  Pennsylvania ;  and  I  take  it  that  none  of  you  to-day 
would  attempt  to  put  your  hand  on  the  swift  passenger 
trains  which  pass  over  the  same  railroad  at  the  present 
time.  We  have  certainly  made  great  progress  in  the 
rapidity  of  locomotion,  to  say  nothing  of  the  comfort. 

(36) 


37 


Over  the  original  highways,  I  believe  the  most  rudi¬ 
mentary  forms  of  government  have  always  claimed  more 
or  less  control.  If  I  mistake  not,  our  forefather  Nimrod, 
in  the  wilds  of  Abyssinia,  claimed  the  right  to  say  who 
should  use  the  highways  and  how  they  should  be  used.  It 
is,  therefore,  not  unreasonable  that  that  claim  should  still 
be  advanced  in  civilized  and  educated  countries.  The 
principal  highways  of  the  country  were  nearly  always  pro¬ 
vided  by  the  government  :  they  were  paid  for  out  of  the 
government’s  money ;  that  is,  money  collected  from  the 
people  who  came  under  its  jurisdiction.  That  policy  was 
pursued  in  our  own  Commonwealth,  with  the  turnpike, 
the  canal,  and  finally  the  railway.  There  are  many  rea¬ 
sons  why  this  should  have  been  so,  aside  from  the  politi¬ 
cal  or  military  necessity  that  the  governments  should  con¬ 
trol  the  highways.  The  controlling  one  was  that  new 
communities  were  not  able  to  amass  the  funds  or  means 
to  improve  the  highways  except  through  the  strong  arm 
of  the  government ;  but  we  find  that  as  soon  as  those 
countries  grew  in  wealth  and  prosperity  they  began  to 
relieve  the  highways  from  the  paternal  control  of  the 
government. 

This  has  gone  on  until  now  nearly  all  the  highways  of 
the  country  are,  as  you  may  call  it,  private  highways  ; 
they  are  not  under  government  control ;  and,  while  they 
are  open  to  the  use  of  each  inhabitant,  yet  they  are  largely 
private  in  their  nature. 

This  separation  of  the  government  from  their  control 
has  driven  the  highways  and  their  improvements  into 
the  hands  of  private  individuals,  and  where  the  individual 
was  not  strong  enough  to  make  the  improvement,  into 
the  hands  of  corporations  ;  but  the  feeling  remains  that 
the  government  should  still  have  some  control  over  these 
highways,  on  the  general  principle  that  the  land  belongs 
to  the  government,  and  that  the  private  corporations  only 
have  the  easement  over  it.  As  the  railways  have  grown 


38 


in  strength,  and  become  important  factors  in  the  im¬ 
provement  of  the  country,  they  have  called  to  their  man¬ 
agement  the  best  intelligence  at  their  command,  and  have 
largely  increased  their  capital  and  have  naturally  been 
brought  into  antagonism,  as  all  such  improvements  are  to 
a  certain  extent,  with  the  rest  of  the  community.  Now, 
this  is  probably  as  it  should  be,  but  we  should  be  careful 
that  this  antagonism  does  not  grow  too  strong,  and  that 
repressive  or  unfriendly  legislation  does  not  run  to  an  ex¬ 
treme. 

It  is  not  fair  to  censure  the  railways  of  the  country 
for  all  the  evils  that  we  find  in  their  administration.  They 
have  been  allowed  largely,  like  Topsy,  to  grow.  There 
was  no  legislation  for  the  government  of  railways,  and 
charters  had  to  be  as  liberal  as  possible,  to  induce  capital¬ 
ists  to  invest  in  such  enterprises.  The  railways  were  fre¬ 
quently  relieved  from  taxation,  their  right  to  make  charges 
in  many  instances  was  unlimited,  and,  even  where  these 
were  restricted,  the  rates  would  now  be  considered 
exorbitant.  The  government,  not  understanding  clearly 
to  what  dimensions  the  railways  would  attain,  permitted 
them  to  go  on  without  that  restraint  which  it  has  placed 
upon  almost  all  other  enterprises,  and  now  it  is  brought 
face  to  face  with  controlling  the  largest  and  most  progres¬ 
sive  undertakings  to  be  found  in  this  country. 

The  people  who  manage  these  railways  are  intelligent, 
shrewd,  have  money  at  command  ;  their  influence  is  great ; 
and  the  struggle  between  them  and  those  who  wish  to  place 
their  hands  upon  them  is  naturally  severe. 

Those  who  approach  this  subject  dispassionately,  I 
think,  will  find  that  the  intelligent  railroad  manager  is 
not  restive  under  any  proper  and  well-framed  laws  that 
either  the  State  or  Federal  Government  desires  to  enact. 

The  railway  companies  are  only  afraid  of  State  com¬ 
missioners  and  interstate  commissioners,  from  the  fact 
that  the  laws  that  are  passed,  and  placed  in  their  hands  to 


39 


enforce,  are  generally  enacted  without  a  very  intelligent 
consideration  of  the  subject  which  they  are  expected  to 
regulate.  This  government  is  young  and  energetic,  quick 
in  its  action,  brooks  no  delay,  and  instead  of  appointing 
commissioners  to  frame  proper  laws,  and  giving  them 
sufficient  time  for  that  purpose,  it  generally  approaches 
the  subject  hastily,  enacts  rough  and  ill-considered  legis¬ 
lation,  and  then  appoints  a  commission  to  endeavor  to 
carry  it  out.  Notwithstanding  I  am  a  railroad  mana¬ 
ger,  I  cannot  but  believe,  as  has  been  said  by  one  or  two 
who  have  preceded  me,  that  the  great  development  of 
this  country,  in  railways,  has  been  due  largely  to  competi¬ 
tion.  It  is  the  activity  of  the  brain  of  our  people  which 
has  enabled  us  to  compete  with  the  wealth  of  other  coun¬ 
tries.  The  best  tariff  law  that  can  be  enacted  in  this 
country  is  the  education  of  our  brains  to  enable  us  to  per¬ 
fect  our  railways  and  machinery,  and  thus  make  the  manu¬ 
facturing  of  any  product  outside  of  this  country,  so  as  to 
compete  with  our  own  products  successfully,  practically 
impossible. 

^  I  cannot  help  referring  at  this  time,  although  it  may 
not  be  connected  with  the  subject  under  consideration,  to 
the  construction  of  steel  and  iron  ships,  which  is  now  in 
its  infancy  in  this  country.  We  all  know  that  it  is  impos¬ 
sible  here  to  take  the  iron  ore  and  manufacture  the  raw 
product  as  cheaply  as  it  can  be  done  in  foreign  countries  ; 
but  a  good  many  of  us  know  that  machinery  is  now  being 
made  and  brought  into  perfection  by  the  activity  of  brain 
of  the  Yankee  that  will  take  that  product  and  put  it  into 
a  ship,  so  that  the  difference  between  the  cost  of  the  raw 
material  in  this  country  and  other  countries  is  gradually 
being  overcome  by  our  superior  facilities  in  bringing  it 
into  the  form  which  makes  it  useful  in  the  construction  of 
the  vessel.  It  will  not  be  long  before  a  tariff  will  not  be  re¬ 
quired  in  this  country,  to  enable  us  to  build  vessels  as 
cheaply  as  they  can  be  built  in  any  other  part  of  the  world. 


40 


We  have  reached  that  point  in  locomotives.  It  is  but  a 
few  years  since  we  could  not  build  locomotives  as  cheaply 
here  as  in  England.  We  now  send  into  the  colonies 
of  England,  to  Australia,  a  better  and  cheaper  locomotive 
than  they  can  send  from  England. 

If  the  government  will  enact  laws  that  will  protect  not 
only  the  shipper,  but  also  the  property  invested  in  railways, 
first  making  those  laws  the  subject  of  thorough  investiga¬ 
tion  as  to  their  adaptability  and  practicability,  and  will 
then  enforce  them  so  that  the  man  who  manages  a  railway, 
and  does  not  break  the  law,  will  not  be  placed  at  a  dis¬ 
advantage  with  his  competitor  who  disregards  it,  I  think 
it  will  find  that  little  or  no  real  antagonism  exists  between 
the  railroad  interests  of  the  country  and  those  of  the 
general  public.  It  is  unfortunately  the  case  that  these 
laws  are  now  so  crudely  approached  and  so  unadvisedly 
passed,  that  when  they  come  to  be  applied  to  the  manage¬ 
ment  and  government  of  our  transportation  interests,  they 
uproot  the  old  systems  which  have  obtained  for  so  many 
years,  and  substitute  nothing  that  is  practical  in  ttair 
place.  The  railways  of  the  country  have  grown  to  tRir 
great  strength  and  usefulness,  simply  from  the  fact  that 
they  have  been  largely  untrammelled  by  any  laws  what¬ 
ever,  and  have  been  let  alone  to  develop  the  enterprises 
that  have  been  committed  to  their  care  in  such  manner  as 
they  thought  would  conduce  best  to  their  own  benefit,  but 
unquestionably  at  the  same  time  to  that  of  the  community 
which  they  endeavor  to  serve. 

A  few  words  on  the  question  of  governmental  control 
of  railways,  and  then  I  will  detain  you  no  longer.  We 
have  heard  it  pretty  ably  expounded  by  our  friend  from 
Massachusetts.  I  heartily  agree  with  all  he  says  on  the 
impolicy  of  either  the  Federal  or  the  State  governments 
endeavoring  in  any  way  to  control  the  railway  system  of 
this  country ;  in  fact,  the  thing  to  me  is  so  absurd  that  it 
is  hardly  worthy  of  serious  discussion.  The  idea  of  any 


